1. Recovered Paper and Fiber Update Paper Division Meeting ISRI Summer Board of Directors Meetings Washington, D.C. July 18, Joseph C. Pickard Chief Economist and Director of Commodities ISRI

2. VIX Spikes after Brexit, Then Drops Sharply

3. Markets Stabilizing After Brexit Vote

4. Recovered Paper Prices

5. U.S. Recovered Paper Market Trends
New Supply
(Short Tons)
Recovered
Recovery
Rate
U.S. Exports
2011
79,444,000
52,767,000
66%
23,233,000
2012
78,498,000
51,092,000
65%
22,326,000
2013
78,954,000
50,128,000
63%
21,029,000
2014
78,206,000
51,171,000
21,180,000
2015
77,895,000
52,040,000
67%
21,581,000

6. YTD U.S. Paper & Board Production -0.8%

7. Overseas Demand for RP

8. YTD Market Gains and Losses
Country
2015 YTD
2016 YTD
$ CHG
% CHG
India
$112,306,340
$131,421,449
$19,115,109
17.0%
Mexico
$102,927,389
$113,392,186
$10,464,797
10.2%
Taiwan
$15,911,771
$21,896,105
$5,984,334
37.6%
Indonesia
$18,868,351
$23,495,738
$4,627,387
24.5%
Thailand
$15,924,893
$20,171,218
$4,246,325
26.7%
Vietnam
$8,009,400
$11,583,702
$3,574,302
44.6%
Japan
$5,330,866
$8,042,226
$2,711,360
50.9%
Netherlands
$6,851,469
$8,600,954
$1,749,485
25.5%
Colombia
$4,814,918
$6,555,162
$1,740,244
36.1%
Italy
$11,939,599
$13,224,354
$1,284,755
10.8%
Canada
$48,596,070
$49,691,503
$1,095,433
2.3%
Trin & Tobago
$83,563
$1,116,637
$1,033,074
1236.3%

9. YTD Market Gains and Losses (cont.)
Country
2015 YTD
2016 YTD
$ CHG
% CHG
China
$824,438,109
$751,555,949
-$72,882,160
-8.8%
El Salvador
$11,807,118
$4,764,054
-$7,043,064
-59.7%
Peru
$6,928,352
$995,814
-$5,932,538
-85.6%
Chile
$5,687,881
$3,879,553
-$1,808,328
-31.8%
South Africa
$1,714,309
$75,075
-$1,639,234
-95.6%
Israel
$2,210,865
$960,325
-$1,250,540
-56.6%
Ecuador
$2,953,833
$1,744,247
-$1,209,586
-40.9%
Malaysia
$1,720,665
$649,444
-$1,071,221
-62.3%
Australia
$1,224,748
$177,117
-$1,047,631
-85.5%
Korea
$81,711,188
$80,665,376
-$1,045,812
-1.3%
Venezuela
$1,634,147
$741,855
-$892,292
-54.6%
Philippines
$3,300,270
$2,471,183
-$829,087
-25.1%

10. Global Developments from BIR Report
“At the start of the second quarter, good availability of US fibres and weaker prices resulted in an increase in exports from the USA at lower price levels, although demand strengthened through the quarter and prices started firming
up.
This also had a direct effect on export values for European fibres: European OCC prices began the second quarter at US$ 160-plus per tonne and strengthened over the period to US$ 167-plus. Similarly, mixed paper prices opened the quarter at US$ 115-plus per tonne but improved to
US$ 130-plus by the end of June.
Demand from the other regular Asian markets of India, Indonesia, Vietnam and Thailand remained steady for news & pams and the middle grades (de-inking, sorted office paper, Multidruck and BBC).
We are anticipating an increase in fibre demand over the next two quarters as the EU economies and the emerging economies of China and India are projected to see growth across the remainder of 2016.”
-- Ranjit Baxi, J&H Sales International Ltd, GBR

11. YTD Chinese Demand from All Origins
CHINESE RECOVERED PAPER IMPORTS (TONNES)
OCC
ONP
Mixed paper
Total RCP
May 2016
1,314,445
428,330
439,128
2,262,835
April 2016
1,524,106
414,630
538,405
2,579,388
  % change
-13.8%
3.3%
-18.4%
-12.3%
May 2015
1,309,809
498,319
523,428
2,425,901
0.4%
-14.0%
-16.1%
-6.7%
Year-to-date 2016
6,905,968
2,030,830
2,499,402
11,806,149
Year-to-date 2015
6,354,253
2,310,840
2,385,118
11,404,582
8.7%
-12.1%
4.8%
3.5%
Source: China Customs and RISI.

12. Global Growth Forecasts for 2016: Developing Economies Still Driving Growth
Source: International Monetary Fund World Economic Outlook (April 2016).

13. Fed Projections for Domestic Economy, June 2016
Variable
Central tendency
2016
2017
2018
Longer run
Change in real GDP
March projection
Unemployment rate
PCE inflation
2.0